California down payments range from 3% to 20% of the purchase price, depending on the loan type and your financial situation

The amount you put down when buying a home in California is not fixed by law—it depends on which loan program you use. A conventional loan (the most common type) typically requires 5% to 20% down. FHA loans allow as little as 3.5% down. VA loans for military members often require zero down. USDA loans in rural areas also require zero down. The lower your down payment, the higher your monthly mortgage payment and the more interest you pay over time, because you are borrowing more money.

California's median home price varies widely by region—from under $400,000 in inland areas to over $1 million in coastal counties. That means a 10% down payment could be $40,000 in one county and $100,000 in another. Your actual down payment amount depends on three things: the purchase price of the specific home, the loan program you may have access to for, and how much cash you have available.

Key Takeaways

  • Conventional loans require 5% to 20% down; FHA loans require 3.5% down; VA and USDA loans often require zero down.
  • A lower down payment means a higher monthly payment and more total interest paid, because you borrow a larger amount.
  • Down payment assistance programs exist in many California counties and cities, covering anywhere from a few thousand dollars to the full down payment.
  • Your credit score, debt-to-income ratio, and savings history affect which loan programs you can access and what down payment amount is realistic for you.
  • The down payment is separate from closing costs, which typically run 2% to 5% of the purchase price and are due at signing.

Conventional loans and the 5% to 20% range

A conventional loan is a mortgage backed by a private lender, not the federal government. Most conventional loans require a down payment between 5% and 20%. If you put down less than 20%, you will pay private mortgage insurance (PMI)—a monthly fee that protects the lender if you stop paying. PMI typically costs 0.5% to 1% of your loan amount per year, added to your monthly payment.

The lower your down payment on a conventional loan, the higher your PMI cost. A 5% down payment triggers higher PMI than a 15% down payment on the same home. PMI stays on your loan until you reach 20% equity in the home (through a combination of down payment and payments over time), or until you refinance. In California's market, where prices are high, many buyers put down 10% to 15% as a middle ground—enough to reduce PMI but not so much that they drain their savings.

FHA loans and the 3.5% minimum

An FHA loan is a mortgage insured by the Federal Housing Administration, designed for buyers with lower down payments or credit scores. FHA loans allow down payments as low as 3.5% of the purchase price. Like conventional loans, FHA loans require mortgage insurance, but it works differently: you pay an upfront mortgage insurance premium (UFMIP) at closing (usually 1.75% of the loan amount) and an annual mortgage insurance premium (MIP) added to your monthly payment.

FHA mortgage insurance does not go away when you reach 20% equity. If your down payment was less than 10%, you pay MIP for the life of the loan. If your down payment was 10% or more, MIP drops off after 11 years. FHA loans are common in California for first-time buyers because the 3.5% down payment requirement is lower than conventional loans, but the total cost (including insurance) can be higher over time.

VA and USDA loans with zero down

VA loans are available to military members, veterans, and some surviving spouses. They typically require zero down payment and no mortgage insurance. You pay a VA funding fee (usually 1.4% to 3.6% of the loan amount, depending on your military status and down payment), which can be rolled into the loan or paid upfront. VA loans are only available through approved lenders and have limits on how much you can borrow in California, though those limits are high in expensive counties.

USDA loans are for buyers in rural areas (not cities or suburbs) and also require zero down payment. USDA loans charge a may provide fee (1% of the loan amount, usually rolled into the loan) and an annual fee (0.35% of the loan balance). USDA loans are less common in California because much of the state is urban or suburban, but they are an option if you are buying in a may have access to rural area.

Down payment assistance programs in California

California has multiple down payment assistance programs run by cities, counties, and nonprofits. These programs provide grants or low-interest loans to help with down payments and closing costs. The amount varies: some programs cover $5,000 to $10,000, while others cover the full down payment. may be able to access usually depends on your income (most programs target buyers earning 80% to 120% of the area median income), credit score (typically 620 or higher), and the purchase price of the home.

Common programs include CalHFA (California Housing Finance Agency) programs, which operate statewide and offer down payment assistance through participating lenders. Many individual cities—including Los Angeles, San Francisco, Oakland, and San Diego—run their own programs with different rules and amounts. Some programs require you to take a homebuyer education course before you apply. The best way to find programs in your area is to contact your city or county housing authority or search the CalHFA website for current offerings.

How down payment size affects your monthly payment

The down payment directly changes your monthly mortgage payment. A larger down payment means you borrow less money, so your monthly payment is lower. It also means you pay less total interest over the life of the loan. On a $500,000 home with a 30-year mortgage at 7% interest, the difference is significant: a 5% down payment ($25,000) results in a monthly payment around $3,325, while a 20% down payment ($100,000) results in a monthly payment around $2,660—a difference of $665 per month, or nearly $240,000 over 30 years.

However, a larger down payment also means less cash in your pocket after closing. If you put 20% down on a $500,000 home, you are spending $100,000 upfront, plus closing costs of $10,000 to $25,000. That money is no longer available for emergencies, home repairs, or other needs. Many financial advisors suggest putting down enough to avoid PMI (20%) only if you have substantial savings left over; otherwise, a 5% to 10% down payment may make more sense for your situation.

Closing costs are separate from down payment

The down payment is not the only money you need at closing. Closing costs—which include appraisal fees, title insurance, escrow fees, loan origination fees, and property taxes—typically run 2% to 5% of the purchase price. On a $500,000 home, closing costs could be $10,000 to $25,000. Some sellers in California negotiate to pay part of the buyer's closing costs, which can reduce the amount of cash you need to bring to closing, but this is not may provide.

Before you start house hunting, calculate both your down payment and closing costs. If you are planning a 10% down payment on a $500,000 home ($50,000) plus closing costs of 3% ($15,000), you need $65,000 in cash available. Some down payment assistance programs also cover closing costs, which can reduce the total amount of cash you need to bring yourself.

Frequently Asked Questions

Can I borrow the down payment from family or friends?

Most lenders allow down payment gifts from family members, but not from friends or employers. The lender will require a signed gift letter stating the money is a gift, not a loan you have to repay. Some loan programs require the gift to cover only part of the down payment; you must contribute some of your own funds. Ask your lender about their specific gift policy before accepting money.

What if I don't have enough for a down payment right now?

You have several options: save for a few more months, look for down payment assistance programs in your area, consider an FHA loan with 3.5% down, or explore first-time buyer programs that may offer lower requirements. Some employers and nonprofits also offer down payment assistance to employees or members. Contact your local housing authority to learn what programs are currently available in your county.

Does a larger down payment help me get approved for a mortgage?

Yes. A larger down payment reduces the lender's risk and can improve your chances of approval, especially if your credit score or income is borderline. It also may may have access to you for a lower interest rate. However, the lender will still review your credit, income, and debt-to-income ratio. A down payment alone does not may provide approval if other factors are weak.

What happens if I put down less than 20% on a conventional loan?

You will pay private mortgage insurance (PMI) as part of your monthly payment. PMI protects the lender and typically costs 0.5% to 1% of your loan amount per year. PMI stops once you reach 20% equity in the home through payments and appreciation, or you can pay to remove it sooner by refinancing or making a lump-sum payment toward principal.

Are there down payment limits in California?

Conventional loans have no down payment cap—you can put down 50% or more if you want. FHA loans cap the purchase price based on county limits (set annually by HUD), but the down payment percentage itself is not capped. VA loans have county-specific limits on the loan amount, not the down payment. Check with your lender about limits that apply to your specific loan type and county.